Investors love biotech stocks for the lottery ticket-like returns they can offer if a company wins the regulator’s blessing. Case in point: Anavex Life Sciences (NASDAQ:AVXL), whose shares are jumping nearly 40% on Tuesday, after receiving approval from the Australian Human Research Ethics Committee to initiate a Phase 2b/3 trial of Anavex 2-73 in Alzheimer’s Disease (AD). The trial will begin with clinical sites in Australia and expand to North America.
Anavex CEO Christopher U Missling commented, “We are extremely pleased to gain approval to initiate the ANAVEX®2-73 Phase 2b/3 study for the treatment of early Alzheimer’s disease, an area of very high unmet need for the growing number of patients around the world.”
Subsequently, Maxim analyst Caroline Palomeque reiterated a Buy rating on AVXL stock, with price target of 7.00, which implies nearly 100% from current levels. (To watch Palomeque’s track record, click here)
Palomeque noted, “Following the early positive data in P2a, moving forward to a larger P2b/3 study is a positive for the company. More details for the study, including which genomic biomarkers will be included in the study are expected in 3Q18.”
If we step back and look at the bigger picture, we can see that overall the stock has a ‘Strong Buy’ analyst consensus rating. In the last 12 months, the stock has received 4 buy ratings, while the average analyst price target stands at $7.67.
Anavex Life Sciences is a publicly traded biopharmaceutical company dedicated to the development of differentiated therapeutics for the treatment of neurodegenerative and neurodevelopmental diseases including Alzheimer’s disease, other central nervous system (CNS) diseases, pain and various types of cancer. Anavex’s lead drug candidate, ANAVEX®2-73, recently completed a successful Phase 2a clinical trial for Alzheimer’s disease. ANAVEX®2-73 is an orally available drug candidate that restores cellular homeostasis by targeting sigma-1 and muscarinic receptors. Preclinical studies demonstrated its potential to halt and/or reverse the course of Alzheimer’s disease.